Automobiles

BMW to use Russia’s TSR for logistics to Korea

[THE INVESTOR] German luxury car brand BMW will use Russia’s Trans-Siberian Railway to transport its cars and automobile parts to Korea from March 2018, according to industry sources on Dec. 6.

The carmaker will reportedly send around 100 40-feet containers annually through the TSR as a pilot run. This is around 7 percent of the total amount of 1500 containers that are currently delivered to Korea from a BMW plant in Germany. The sources noted that the carmaker will take a final decision on continuing the TSR logistics after its pilot run ends.

“We will try it until July 2019 and discuss what we will do afterward,” a BMW Korea spokesperson told The Investor.

BMW plans to transport its auto parts and vehicles from Germany on the TSR to Dalian, China, on the first leg of the journey. It will then use the shipping route from Yingkou to Busan seaport. The carmaker currently uses a shipping route that touches Europe, Southeast Asia and finally Busan, which takes around 60 days. By using the TSR, the travel time can be cut down to 35 days.

Industry watchers say local firms, which export to European countries, can take advantage of BMW-booked TSR trains that return from Dalian after offloading its containers. The price of using TSR is currently burdensome for some local companies because they have to also pay for the return tourney of empty trains.

Meanwhile, the Moon Jae-in administration is also encouraging logistics using the TSR. The president has asked Russian Prime Minister Dmitry Medvedev to simplify customs procedures when they met on the sidelines of a regional forum hosted by the Association of Southeast Asian Nations in Manila last month.